Do the Feasibility Work Before You Outsource

Interesting interview with Dan DiFilippo, global leader for performance improvement at PricewaterhouseCoopers, in this month's Optimize (“Are You Outsourcing More and Enjoying It Less?“). The firm just surveyed US and European multinational companies about outsourcing and discovered this shocking — shocking! — stat: “51% said they would've benefited from a feasibility and cost-benefit analysis ahead of time.” Hellooo?

Let's see. How about if we introduce upheaval and chaos into the ol' company environment, disrupt jobs, possibly jeopardize mission-critical aspects of the business, and only then examine whether the work we want to outsource makes sense from financial, feasibility and risk perspectives.

The fact that we talk about “thought leadership” (343,000 Google results!) tends to make me believe that leaders who think aren't really all that common.

At any rate, Mr. DiFilippo points out, “Remember, whatever issues of complexity you're struggling with will be a struggle for the outsourcer as well. CIOs should explore those difficult areas at the beginning of the deal to understand how the outsourcer can avoid them.”

And if you're already in a contractual arrangement and the payback just isn't happening for you, he advises that you spend some time doing the “proper analysis.” “It's never too late to put the proper stipulations into a contract.”